In the 17th November 2022, Autumn Statement, Chancellor Jeremy Hunt announced that millions of people will pay more tax as he cut the top-rate threshold and announced freezes on several other taxes.
Based on the Autumn Statement, the total amount of savings has been costed at £55bn, through tax rises and cutting government spending.
The announcements came as the government’s forecaster warned that living standards were set to fall by the largest amount in modern history, as the rising cost of living eroded people’s wages.
According to the independent Office for Budget Responsibility, UK incomes are predicted to fall by 7.1% over the next two years, with real-term costs reaching levels not seen since the 1950s.
Here are some of the key announcements in the Autumn Statement
UK is in recession
The Chancellor has acknowledged that the economy will shrink by 1.4% next year, saying that things will get worse before they get better.
Stamp Duty
In a recent statement, Hunt confirmed that the cut to stamp duty would remain in place.
Capital gains tax
The Chancellor has announced a reduction in the amount of money an individual can earn before paying capital gains tax, from £12,300 to £6,000. It will then be cut to £3,000 starting April 2024.
Inheritance Tax
Hunt has confirmed that inheritance tax will remain frozen, and the triple lock on pensions will remain in place.
Council Tax
Councils will be given the power to raise council tax by 5% annually, according to the government. At present, they may only increase taxes by 3% a year including a 1% precept for social care, without holding a local referendum.
Top Rated Income tax
The Chancellor announced that the threshold for when the highest earners start paying the top rate of tax will be brought down from £150,000 to £125,140. This means that those earning £150,000 or more will pay an additional £1,200 a year in taxes.
Energy payments from April
The government has announced that it will extend the Energy Price Guarantee for a year from April. The scheme helps families and small businesses with their energy bills, but households will see their bills increase by around £3,000 annually when it comes into force.
What does it mean as a first time buyer?
The government's decision to reverse its cut to stamp duty on properties under £250,000 and £425,000 for first-time buyers will have a negative effect on the housing market. Experts are concerned about what effect this will have on young people who are trying desperately hard to get onto the property ladder before prices rise again
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